TL;DR

Western Digital CEO Irving Tan confirmed during the company’s Q2 2026 earnings call that it has sold out of hard drives for the entire calendar year. The company has firm purchase orders from its top seven customers and has already signed long-term agreements extending into 2027 and 2028, driven almost entirely by AI data centre demand.

Cloud business dominates

Western Digital’s cloud business now accounts for 89% of revenue, with consumer sales contributing just 5%. The company has firm purchase orders with its top seven customers and has signed long-term agreements with two customers for 2027 and one for 2028, covering both volume and pricing commitments.

The shift reflects the enormous storage requirements of AI infrastructure. Hard drives remain significantly cheaper than SSDs for bulk data storage — by some estimates, equivalent SSD capacity costs more than 16 times as much — making them the practical choice for the massive data sets that AI training and inference require.

Consumer impact

The data centre-driven shortage is hitting consumer prices. HDD models have surged by an average of 46% since September 2025, adding to a broader pattern of AI-driven hardware inflation that has already affected memory chips, SSDs, and GPUs.

While most consumers now use SSDs for their primary storage, hard drives remain the standard for NAS systems and long-term data archiving. The shortage extends a trend that started with memory and storage chips, spread to GPUs, and has now reached hard drives.

Looking forward

The sell-out signals that AI infrastructure buildout is consuming hardware capacity faster than manufacturers can scale production. For UK businesses planning data infrastructure investments, the message is clear: lead times for storage hardware are extending well beyond normal planning horizons, and early procurement commitments are becoming necessary to secure supply.